The Winnipeg real estate market continues to be a seller’s market in 2022, but as new listings rise, could that be changing?
It appears that the Winnipeg real estate market may have peaked in May, as month-to-month prices fall, even though year-to-year prices have risen. According to data from the Winnipeg Regional Real Estate Board, the year-to-date average single-family home selling price is $431,158, up from the 2021 average of $379,844.
Month-to-month data shows a cooling off of the market—the average single-family home sold for $400,000 in July, compared to over $454,000 in May. Rising interest rates are a critical factor in the decline, but there is more to the story.
Another key factor is the rising choice of homes. There were 3,700 active listings available at the end of July compared to half that amount in the first four months of 2022. There were 2,359 new listings in July, an increase of nine per cent over July 2021.
“We are seeing once very tight market conditions loosening up in the second half of 2022,” says Akash Bedi, president of the Winnipeg Regional Real Estate Board, “above list price sales for both single-family homes and condominiums are trending down from what they were earlier in the year.”
Though July 2022 was not up to the peak pricing of earlier in the pandemic, it is still one of the best Julys on record. When you remove the 2020 and 2021 data, July 2022 outperforms any other July and ranks as the third-best July on record. So, we are not exactly experiencing a full-on market correction just yet.
Who’s Driving Demand for Winnipeg Real Estate?
Like many other cities across the country, move-over buyers drove much of the rising demand during the first two years of the pandemic. This population increase has had a significant impact on the local economy and the real estate market. It’s no surprise that people wanted to move to the city; it is one of the most affordable in Canada. Families can purchase a detached house below the national average price.
Our 2022 Housing Affordability Report ranked Winnipeg at number 10 on the list based on where homebuyers can own a home for the lowest price. If you are in Vancouver or Toronto, these numbers may make you realize why people have been relocating:
- Average Home Price (January 1 – June 30, 2022): $437,460.00
- 20% Down Payment: $87,492.00
- Mortgage Amount: $349,968.00
- Monthly Mortgage Payment: $2,104.00
- Average Monthly Income: $65,381.25
- % of Monthly Income Allocated to Mortgage: 39.10%
First-time homebuyers in Winnipeg are typically young couples looking for single-detached homes. These properties range in price from $300,00 to $400,00. Bidding wars have continued to impact both first-time homebuyers as well as move-up buyers from entering the market.
Move-up buyers in the Winnipeg housing market are typically families, and many have decided to wait on entering the market if their current home continues to meet their needs. This results in a lack of urgency to move.
The condominium market in Winnipeg is most popular with single homebuyers and young couples, with the average price for a condominium in Winnipeg being $271,901. The current condo market in Winnipeg is better than it has been in a while but is still slower than the detached home market.
Winnipeg New-Home Construction
According to Canada Mortgage and Housing Corporation (CMHC), new housing construction activity has increased slightly this month. Housing starts increased six per cent month-over-month to 471 units in July.
What Does the Future Hold for the Winnipeg Real Estate Market?
Industry professionals concede that the Winnipeg real estate market, as well as the broader housing sector in Manitoba, is tilted toward sellers, mainly because of tight inventory levels.
The gap between buyers and sellers is not as vast as in other markets such as Toronto and Vancouver. Considering the current values and pricing forecasts for the Winnipeg real estate market this year, it remains one of the most affordable cities in Canada.
Finally, with the Bank of Canada (BoC) raising interest rates, the conditions in the Canadian real estate market could be rebalancing. Though Winnipeg is unlikely to sustain its pandemic-level growth, it is doubtful that it will return to pre-pandemic prices. Time will tell what the happy median will be.